Engie-supported National Central Cooling TABREED, commonly referred to as Tabreed, is currently engaged in exclusive negotiations to acquire the district cooling operations of Multiply Group, based in Abu Dhabi. This deal is anticipated to value the entity at over $1 billion, according to sources familiar with the discussions.
Reportedly, Tabreed and private equity firm CVC emerged as the leading bidders for PAL Cooling Holding (PCH). The sources further indicated that negotiations between the parties have commenced.
One insider noted that the proposed bid approaches $1.1 billion.
Following the news of the negotiations, Tabreed’s shares experienced a rise of 4.3% during midday trading, reaching 2.68 dirhams ($0.7297).
The interest in acquiring PCH underscores the growing attraction of international investment firms to the Gulf region, fueled by governmental efforts to diversify economies beyond oil dependency.
In its statement, Tabreed refrained from commenting on market speculation, emphasizing that any significant transactions will be disclosed at the appropriate time once finalized.
CVC chose not to provide comments, and Multiply Group did not immediately respond to inquiries.
Earlier reports indicated that CVC was collaborating with Tabreed to submit a joint bid for PCH.
District cooling systems, which supply chilled water through insulated pipes to cool commercial, industrial, and residential properties, are recognized as a cost-effective and sustainable alternative to traditional air conditioning methods.
Such systems are particularly prevalent in the United Arab Emirates and throughout the Arabian Peninsula, where summer temperatures can exceed 50 degrees Celsius (122 degrees Fahrenheit).
PCH, established in 2006, operates several plants in Abu Dhabi, boasting a combined design capacity of 242,000 refrigeration tonnes as detailed on their website.
Previous reports indicated that the potential sale attracted interest from other bidders, including KKR, I Squared Capital, Investcorp, and TAQA, with an expected sale price of around $1 billion.
Multiply Group is under the control of IHC IHC, led by Sheikh Tahnoon bin Zayed Al Nahyan, who serves as the UAE’s national security adviser and is the brother of the country’s president. Sheikh Tahnoon oversees a vast business network that includes two sovereign wealth funds.
($1 = 3.6727 UAE dirham)